BARRATT ENGINEERING SERVICES LTD

Executive Summary

BARRATT ENGINEERING SERVICES LTD shows clear signs of financial weakening, with a significant reduction in cash and net assets over the past year, indicating liquidity and capital erosion. Immediate focus on cash flow management, cost control, and strategic planning is essential to stabilize and improve financial health. Without intervention, the company risks deeper financial distress.

BARRATT ENGINEERING SERVICES LTD - Analysis Report

Company Number: 12846063

Analysis Date: 2025-07-19 12:55 UTC

Financial Health Assessment for BARRATT ENGINEERING SERVICES LTD

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1. Financial Health Score: D

Explanation:
The company shows signs of financial distress with a sharp decline in net assets and current assets over the latest year, indicating a weakening balance sheet. While the company is not insolvent (net assets remain positive), the rapid depletion of working capital and fixed assets signals caution. This grade reflects a need for immediate attention to liquidity and asset management to avoid further deterioration.

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2. Key Vital Signs

Metric	2024 (£)	2023 (£)	Interpretation
Fixed Assets	132	413	Significant drop, possibly asset disposals or write-offs.
Current Assets	2,059	8,250	Sharp decline in cash/debtors; symptom of cash flow issues.
Current Liabilities	0	1,031	Improvement, no short-term debts outstanding.
Net Current Assets	2,059	7,219	Strong drop, reducing working capital available.
Total Assets Less Current Liabilities	2,191	7,632	Overall financial strength substantially weakened.
Net Assets / Shareholders Funds	2,191	7,632	Equity buffer reduced by over 70%, indicating erosion of capital.
Employees	0	0	No employees, likely outsourcing or very small scale.

Interpretation:

• The healthy cash flow represented by current assets has sharply diminished, a key "vital sign" indicating the company may be facing liquidity stress.
• Reduction in fixed assets suggests either asset sales or write-downs, potentially a symptom of restructuring or cutbacks.
• Zero current liabilities in 2024 may reflect paying off short-term debts but also possibly delaying new credit.
• Significant shrinkage of net assets signals the company’s "financial immune system" is weakened.

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3. Diagnosis

BARRATT ENGINEERING SERVICES LTD is currently operating but shows symptoms of financial distress. The company’s working capital has decreased by nearly 72% in one year, which is a warning sign analogous to a patient losing vital fluids rapidly. The absence of current liabilities could be a positive sign of prudent management or reflect inability to access short-term credit. The erosion of net assets indicates the company may have experienced losses or asset write-downs, undermining financial stability.

No employees are reported, indicating a lean or possibly dormant operational state, which might affect the company’s revenue-generating capacity. The company is classified as a micro-entity, which limits detailed financial disclosures but the available data suggests liquidity pressure and shrinking capital base.

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4. Recommendations

• Liquidity Management:
  Immediately assess cash flow to ensure the company can meet short-term obligations. Consider negotiating payment terms with suppliers or seeking short-term financing to rebuild working capital.

• Asset Review:
  Conduct a thorough review of fixed assets to determine if disposals were strategic or forced by cash needs. Avoid further asset erosion unless it supports operational sustainability.

• Cost Control:
  With no employees, the company likely outsources operations. Review contracts and expenses to ensure costs are aligned with revenue and sustainable.

• Strategic Planning:
  Develop a turnaround plan focusing on increasing revenue or securing new contracts to stabilize the financial position.

• Stakeholder Communication:
  Maintain transparent communication with shareholders and creditors about financial status and recovery plans to sustain confidence.

• Financial Monitoring:
  Implement more frequent financial reviews to detect early signs of distress and act proactively.

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